Profit warnings, branch closures and job losses: however you look at it, the picture for estate agents over the past 12 months has been far from pretty.

In spring, when homebuyers are usually full of enthusiasm, the number of sales had already fallen by an estimated 30 per cent on the same period in 2007. By September, the Royal Institution of Chartered Surveyors (RICS) was reporting that transactions had fallen by 50 per cent, with estate agents selling an average of just one home a week.

Even before the collapse of Lehman Brothers — now generally regarded as the moment that the world changed — the desperate lack of mortgage finance and house price falls since autumn 2007 had knocked confidence in property, setting a bleak scene for the country’s estimated 30,000 agents.

The number of sales has since dwindled to less than one a week, with an average of 10.6 properties being sold per agent in the three months to the end of November — the lowest level since RICS began compiling figures in 1978. The number of agents has fallen accordingly, with job losses reaching an estimated 7,000 already and expected to double by the time the downturn has done its worst.

Humberts was the first high-profile victim, entering administration in the summer before being bought out by the Mercantile Group and merging with Chesterton this month. It lost 46 out of 80 branches in the process.

Other big names have been retrenching. Halifax announced it would close 53 of its estate agency offices and shed 100 jobs before the year was out, while Connells, owned by the Skipton Group, has closed 25 of its 485 branches this year. It recently sold its majority 17 per cent stake in Rightmove, the property listings website, raising £33 million.

Countrywide, the UK’s biggest estate agency, has given warning of branch closures and redundancies. Standard & Poor’s, the credit rating agency, downgraded the group’s creditworthiness amid fears that it could run out of cash by the end of next year. Countrywide recently held an end-of-year promotion to try to boost sales before Christmas.

Meanwhile Savills, the global property group, has issued two profit warnings in the second half of this year. Since reaching a high of 732p in May 2006, its share price has plunged to 226p. The group has not given away details of job losses or branch closures, but said “there will be job cuts in the areas of the business most affected by the current trading situation”.

The fortunes of Rightmove have served as a barometer for estate agents’ woes. Last month, it reported that membership fell to 10,700 by the end of October, a decline of 15 per cent from the 12,600 on its books a year earlier. It said that three out of four agents who had left the site had done so because they had closed down, or were in danger of doing so. This time last year, Rightmove shares were trading at 435p. Now, they are worth just under 173p.

Other names known only locally have been forced into small-scale mergers, administration or liquidation, although there is no word yet from the one name on everyone’s lips — Foxtons. The flashy London chain rode the crest of the wave in the boom and was bought in 2006 at the top of the market by BC Partners, the private equity group, in a “highly leveraged” £360 million deal. Foxtons, founded by Jon Hunt in 1981, is yet to show signs of weakness.

Times will remain hard during 2009, though agents agree that November was the worst month they can remember, and two big interest rate cuts later, things have already begun to improve. Still, very few properties are coming to the market, and of those that are, many are “distressed” sales, where people are forced, either through death, divorce, relocation or unemployment, to sell up.

Despite the continued gloom, estate agents are adopting a “glass-half-full” attitude in 2009. Nowhere is this mood of defiance more evident than in the merger between Chesterton, the London agent, and Humberts, which has offices across the country, earlier this month.

In January, Chesterton Humberts will open a flagship office in South-west London, and it will not be understated. Expect Banksy paintings on the walls and low-level ambient tunes.

Meanwhile, agents are coming up with initiatives to boost their survival prospects. Many that had previously focused solely on sales are now opening lettings divisions to capitalise on demand. There has been a 30 per cent increase in letting activity this year, according to Winkworths, as buyers rent while they await the bottom of the market. Other tactics are even more inventive. For example, Connells has introduced a stock transfer programme, offering to sell properties on behalf of competitors that are closing down and returning one third of the commission to the original agent when the property is sold.

Where there are determined buyers and sellers willing to accept substantial reductions, agents are reporting activity. Chesterton Humberts said that this month’s viewings are at December 2007 levels, with offers exceeding 2007 levels. The buyers and sellers of one property recently on the market with its Farleys brand exchanged contracts approximately four hours after the offer was accepted.

There is evidence that first-time buyers, intrigued by the potential for bargains, are coming out of the woodwork, often aided by money from generous relatives. New homeowners made up 10.4 per cent of total sales last month, compared with 9.7 per cent in October, according to the National Association of Estate Agents (NAEA).

Stephen Shipperley, chairman of Connells, says: “For first-time buyers, now is the best time to buy for years.”

The NAEA says that there is also pent-up demand, with many potential buyers waiting eagerly at the sidelines for lenders to start freeing up competitive mortgage deals to those with smaller deposits. If this happens, a surge of interest is expected.

For agents hoping to take advantage of the upswing when it comes, consolidation is key and the stronger players are building up their war chests. Mr Shipperely said: “Over the coming months, there will undoubtedly be some assets available. We will have the cash and ambition to grow. The best time to buy is when things are dull and dismal.”

Agents say that homebuyers should apply the same logic, while interest rates are low and sellers eager to negotiate. David Adams, head of residential at Chesterton Humberts, said: “The majority will wait until taxi drivers say we’re at the bottom, but by then, it will be too late. In five years, people will look back and wish they had bought now. Next year will be a short-lived window of opportunity.”

Eager to accommodate

The phones may not be ringing, but instead of twiddling their thumbs, estate agents have been putting their way with words to good use with jargon that befits today's tougher climate.

If an agent talks about short-circuiting, for example, he is not worried about the electrics, he is advising that big falls in the price of medium-sized family dwellings in the countryside mean that some buyers are now in a position to jump a rung or two of the housing ladder. For a young family with relatively low borrowings, this could mean moving straight from a small urban townhouse to a detached four-bedroom with three acres.

Among agents selling new-build homes, the chat is focused on up-specs - where developers offer better-quality fixtures and fittings to entice buyers who are wary of further price falls and want more for their money. This demanding crew expect the show home furniture to be thrown in.

Whereas two years ago gazumping was the thing among those confident of further price rises, gazundering - buyers reducing their offer at the last minute - has taken over. The problem of down-valuations have replaced the boom-time plague of over-valuations, while distressed sellers, rather than aspirational ones, are now in the majority.

Evidence that houses are now seen as homes rather than investments is emerging as agents report that end-users - the technical term for buyers who intend to live in a property rather than use it for buy-to-let - now make up about 75 per cent of those buying new-build property in London, compared with just 20per cent in 2007. If you are a buy-to-let investor, the chances are you are equity-rich rather than leveraged, the banking term for borrowing that agents have adopted to describe buyers who are mortgaged to the hilt.

Even if you have cash, don't do anything until you have learned to rumba. Not ballroom dancing but “Research and Understand the Market Before Acquisition”.

The downturn hits home

In the first nine months of this year, estate agents say that many prospective sellers refused to accept that their home was worth less than at the peak of the market, although the rout was the subject of daily headlines. This led to unrealistic asking prices that had to be slashed to excite any interest, giving an exaggerated impression of the extent of the market's decline in some locations. This state of denial lasted until the collapse of Lehman Brothers.